Gasoline prices continue to slide in the waning weeks of summer on cooling demand and rising domestic production. But markets are keeping close watch on renewed tropical storm activity in the Atlantic and increasing geopolitical tensions in the Middle East. 

  Last week, demand for gasoline reached 8.9 million barrels a day, a drop of nearly 300,000 barrels a day compared to the prior week, according to the latest report from the Energy Information Administration. Meanwhile, inventories, which had been shrinking for two weeks straight, rebounded as refiners added 1.3 million barrels to the national stockpile.  

The supply and demand picture mitigates the impact of crude oil prices, which rose sharply last week in anticipation of escalating conflict in the Middle East. Crude prices were also buoyed by the formation of a new tropical disturbance in the Atlantic, which is now likely to become Hurricane Ernesto and could threaten the United States later this week according to a release from AAA Northeast.  

The average gas price in Rhode Island is down five cents from last week, averaging $3.35 per gallon. Monday’s price was 13 cents lower than a month ago and 40 cents lower than a year ago. Rhode Island’s average gas price is nine cents lower than the national average.  

“By all accounts, as the summer driving season enters its final laps, gas prices are falling on seasonal trends,” said Jillian Young, director of public relations, AAA Northeast. “But tensions in the Middle East and renewed tropical storm action could flip the script.”